Wolfgang Schäuble: Greece will need third bailout

German finance minister Wolfgang Schäuble has admitted for the first time that Greece is likely to need another bailout package to plug a forthcoming funding blackhole.

Greece has already been handed two rescue deals worth €240bn (£205bn) by the International Monetary Fund (IMF), the European Central Bank and the European Union. Last month, the IMF estimated that the country will have a financing gap of €11bn in 2014-15.

Speaking at an election rally, Schäuble said: “There will have to be another programme in Greece.

“The Greeks need until 2020 until they have re-established debt sustainability according to the calculations we made then – and they weren’t overly pessimistic. We will have to help them again so that they don’t have to pay such high interest rates for this maturity.”

Schäuble’s comments come at a sensitive time, as Germany prepares to hold elections in five weeks’ time. The German electorate tends to be uncomfortable with European bailout, as they provide the largest share of the EU’s contribution.